SEPA Core Direct Debit (SDD Core)
Since February 01, 2014, the long prepared migration of credit transfers and direct debits to the Europe-wide uniform standard SEPA is valid. The changeover, which is still in progress, brought about some problems with payment transactions in the 33 European countries involved. Direct debits and credit transfers can still be made according to the old standard until August, but the majority of payment transactions are already being made according to the new procedure.
The changeover will result in some changes with regard to payment transactions, both for private customers and, above all, for companies and associations. Instead of the bank code and account number, the so-called IBAN will become valid with the SEPA changeover, and the BIC will also be required for intra-European transfers until 2016. The 22-digit IBAN consists of a country code, a check digit and the familiar bank code and account number. However, the bank code and account number can still be used by consumers in their familiar form until 2016. Direct debits from companies or associations are usually automatically transformed into the new SEPA format by the banks.
While the changeover generally changes little or nothing for consumers, companies and associations must pay attention to some aspects regarding direct debits via SEPA.
How does the SEPA core direct debit works?
There are essentially three procedures for the uniform collection of money throughout Europe. The so-called company direct debit or SEPA Business to Business Direct Debit (SDD) collection is intended exclusively for transactions between business customers. The basic SEPA Core Direct Debit variant for normal direct debits contains some elements of the familiar direct debit authorization, but several new aspects must be taken into account.
The consumer will be informed of the upcoming account debit 14 days before the due date, unless otherwise specified in the General Terms and Conditions (GTC). Furthermore, the customer can object to an account debit by direct debit; instead of the usual six weeks, he now has eight weeks after the debit. If there is no authorized, valid order at all, the period is even 13 months.
In addition to these changes, the changes regarding the SEPA core direct debit mandate must also be taken into account. This mandate corresponds to the previously valid direct debit authorization. It is particularly important in this context that the creditor must inform the debtor in writing about the changeover to the new procedure before the first direct debit. In addition to some other information, the creditor identification number and the mandate reference must be stated.
The structure of a direct debit mandate
The European Directive or its national implementation stipulates some mandatory content for the structure of a valid direct debit mandate. First, the address data of the collecting company or association as well as its identification number and mandate reference must be stated.
In the subsequent text passage, the debtor authorizes the creditor to have the amounts due in each case debited. The eight-week objection period should also be mentioned in this section. Finally, the payer also states his address data as well as the corresponding bank details. The direct debit mandate becomes valid with a final signature stating the date and place; apart from this, mandates can in principle also be issued verbally.
For companies, the changeover primarily changes the need for a so-called creditor identification number, which can be applied for in Germany at the Bundesbank. Debtors benefit from the fact that account debits are displayed in the disposition before they are debited. The following table shows the changes in a clear form:
|SEPA Core Direct Debit||National use|
|Europe-wide use in 33 countries||Reference to authorization|
|Mandate information for direct debit||Due date is immediate|
|Due date to be specified||No such number available|
|IBAN and BIC||Account number and Bank code|
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